Every day, Jim Cramer hears that oil is about to roll over, but now it seems things have finally turned around.

While many may not want to accept that the global landscape is improving, Cramer sees signs that things are bouncing back faster than anticipated, especially for oil.

"I think the clock is ticking, and the deals are about to happen," the "Mad Money" host said.

Going into the meeting in Doha last weekend, the expectation was that the world's major oil players would agree on a production freeze. Many hedge funds thought this was preposterous, and aggressively shorted the oil and oil service stocks.

FREDERIC J. BROWN/AFP/Getty Images

A red star fronts a pressure tank at the Yanlian Oil Refinery in Yan'an, 25 May 2005, north of Xian in western China's Shaanxi province.

"I think the clock is ticking and the deals are about to happen."-Jim Cramer

Then it turned out there was no deal, and oil futures broke down on Sunday.

"That was just plain wrong. Why? Because the Doha meeting and all the chatter about a production freeze never mattered. What matters is supply and demand," Cramer said.

One of the main drivers for the demand in oil, Cramer said, could be China. At the same time, Chinese drilling has yielded fewer barrels a day as its fields become played out. Thus, demand for crude could increase in China.

"I think China is coming back, so rather than finding this rally in oil puzzling and fighting it like so many hedge funds out there, I embrace it," Cramer said.

At the same time, Cramer would not be surprised to see integrated oil companies launch takeover bids. Specifically, he considered the easy targets to be oil companies that can make money at $40 a barrel.

This would explain the market interest in spurned Baker Hughes, the company that was supposed to be purchased by Halliburton.

On the flipside, the usual stocks that investors flee to for safety have done poorly. This would account for the decline in Coca-Cola, as investors search for stocks that benefit when the global economy is recovering.

That means the most dangerous stocks in this environment are utilities, Cramer said. Utilities tend to perform poorly when interest rates go higher from natural demand and there is no flight to safety.

So, for those investors wondering why shares of PepsiCo fell on Wednesday; the answer is nothing.

"You are just being victimized by a breathless deep value rotation that many in the hedge fund world are fighting every step of the way," Cramer said.

Cramer advised that the ultimate defense to this kind of a stock rotation is to be diversified. It is the only way to handle the pain, and stay the course.